Tuesday, 1 May 2012

Silver Bird Group to finalise proposed restructuring scheme by mid May

KUALA LUMPUR (May 1): SILVER BIRD GROUP BHD []’s proposed group restructuring scheme is expected to be finalised by the middle of May 2012 said Silver Bird Group’s chairman of audit committee, Richard Azlan Abas after the company’s AGM on Monday.

“The group restructuring plan will include, but not limited to, capital reduction, share consolidation, rights issue and debt restructuring. However, it is still in its preliminary stage and very fluid. We hope to finalise the proposed plan once we get an agreement from the major stakeholders by the middle of May.” he added.

When asked about the amount of rights issue which the company intends to raise for its restructuring plan, Richard said it would amount to RM60 million.

“Major shareholders have been cooperative thus far as we are working for a solution that will be favourable for shareholders,” he said.

Richard mentioned that on-going forensic investigations has encountered several speed bumps as they were faced with wilful destruction of documents, high volume of unusual transactions which the alleged executive directors were not present for explanation as well as certain records that had been taken away by authorities.

The company’s restated accounts as at Feb 29, 2012 which was announced on Bursa Malaysia last Friday recorded a negative shareholders fund variance of RM 297.08 million as compared to that as at Oct 31, 2011.

“RM18 million is attributable to the four months operation [between Oct 31, 2011 to Feb 29, 2012] and RM279 million is in relation to adjustments made. The RM300 million variance will be reflected in 2QFY12 results,” said Richard.

Chairman Datuk Dr Gan Khuan Poh added that the company practiced prudence, as accorded by accounting standards, when providing for impairment and other non monetary transaction adjustments explaining the RM300 million losses in the restated financial statements.

According to the company, with the RM300 million of losses reflected in the company’s financial statement, it will most likely post a loss position for the FY12.

However, the company said that a viability study conducted by independent consultants indicated that the company can be turned around into a profit making situation moving forward provided it is properly managed.

“If we can increase the average sales to back where we were before (the irregularities occurred) and if we can monetise our network and create value out of it, we can bring in significant increase in revenue.

“So far, I think the value of our network has not been maximised yet,” said Gan.

Gan told the press that to counter competition and gain back sales, the company is strategizing to venture into a new niche segment of premium bread. Currently, research is being conducted for its proposed premium bread segment.

Silver Bird Group was thrust into the spotlight earlier this year when the company sought more time to table its annual audited financial statements which was due end February. Share price closed at 0.16 sen on Monday, up 3.23%.